The Bipartisan Budget Act of 2015 contains a few surprises for employers covered by the OSH Act. To date, OSHA’s monetary penalties have not been subject to inflationary increases and, in fact, have been static since 1990. The proposed “Federal Civil Penalties Inflation Adjustment Act Improvement Act of 2015” which applies specifically to the OSH Act shakes up the status quo. If approved, OSHA will be required to adjust its penalties annually based on the Consumer Price Index (CPI). Beginning in January 2017, annual updates to civil penalties will be published each year by January 15th in the Federal Register. These adjustments will not require rulemaking.
However, the Act’s immediate impact is twofold. Section 701 contains a “catch up” provision which increases civil monetary penalties, based on a formula, up to a cap of 150%. So according to the Bipartisan Budget Act “a penalty now set at $10,000 could not increase to more than $25,000.” Further, the Act provides steps to “speed implementation” of these changes so that if approved, the first adjustment to penalties would be published by July 1, 2016 (at the latest) and be effective by August 1, 2016 (at the latest.)
We will be following these developments closely and bringing you updates. A summary of the Bipartisan Budget Act of 2015 can be read here.